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“Building an AI-Ready America: Understanding AI’s Economic Impact on Workers and Employers”

House Committee on Education and Workforce
April 15, 2026 (recording linked here)

HEARING INFORMATION

Witnesses and Written Testimony:

• Ms. Chatrane Birbal, Senior Vice President, CHRO Association

• Mr. Matthew Gizzo, Shareholder, Ogletree Deakins

• Ms. Sara Steffens, Worker Power Director, We Build Progress

• Ms. Rachel Greszler, Senior Research Fellow, Advancing American Freedom

HEARING HIGHLIGHTS

QUICK SUMMARY

• Balancing Innovation and Regulation: Lawmakers and witnesses broadly agreed that AI is transforming the workforce and economy, but diverged on how aggressively it should be regulated. Republicans emphasized the need to avoid overregulation that could stifle innovation and harm U.S. competitiveness, particularly against countries like China. Witnesses highlighted the benefits of AI in improving productivity, compliance, and job quality when used responsibly. The central debate focused on whether a flexible, principles-based federal framework or stronger guardrails should guide AI policy.

• Worker Protections and Surveillance Concerns: Democrats and labor-aligned witnesses raised concerns that AI could exacerbate inequality, enable intrusive workplace surveillance, and weaken worker protections. Testimony highlighted how AI tools can track employee behavior, collect sensitive data, and potentially be used to suppress organizing or discriminate in hiring. Witnesses argued that existing labor laws are insufficiently enforced and that new protections, particularly around data privacy and transparency, are needed. The discussion underscored a broader concern that technological adoption is outpacing worker safeguards.

• Patchwork Regulation vs. Federal Standards: Several witnesses and members pointed to the growing patchwork of state and local AI regulations as a major compliance challenge for employers. Business-oriented witnesses argued that inconsistent rules across jurisdictions create confusion, increase costs, and discourage AI adoption, especially for small and mid-sized companies. They advocated for a unified federal approach that establishes clear standards while allowing flexibility as the technology evolves. Others warned that preempting state laws could weaken important worker protections.

• Data Gaps and Policy Uncertainty: Witnesses emphasized that policymakers currently lack sufficient data to fully understand AI’s impact on jobs, productivity, and workforce trends. Recommendations included expanding federal data collection efforts to track how AI is changing specific job tasks rather than just employment levels. Members highlighted that better data would help guide workforce training, business investment, and regulatory decisions. The lack of reliable information was framed as a key barrier to crafting effective and forward-looking policy.

• Economic Disruption and Workforce Transition: Members debated the potential for AI to displace jobs, particularly white-collar roles, while also creating new opportunities and shifting skill demands. Some warned of large-scale unemployment risks, while others argued that technological change historically leads to job transformation rather than elimination. Witnesses noted that AI is more likely to replace tasks within jobs than entire occupations, requiring workers to adapt and reskill. The discussion reflected uncertainty about the pace and scale of disruption, but consensus that workforce preparation will be critical.

IN THEIR WORDS

SUMMARY OF OPENING STATEMENTS

• Chair Mackenzie stated that artificial intelligence was already reshaping the economy, workforce, and global competitiveness across industries. He emphasized that small businesses were among the fastest adopters of AI and that smaller employers expected AI to increase hiring rather than reduce it. He argued that Congress needed better data on AI’s impacts before pursuing legislative action and stressed that policy should be grounded in evidence. He expressed concern about a growing patchwork of state and local AI regulations, warning that inconsistent rules could create compliance burdens, particularly for small businesses. He also highlighted global competition in AI and the importance of maintaining U.S. leadership. He concluded that Congress must balance fostering innovation with implementing safeguards to protect the public interest.

• Ranking Member Omar argued that the committee’s focus on AI had come at the expense of addressing other urgent labor and economic issues, such as wage stagnation and workforce shortages. She criticized the lack of legislative action from the majority on protecting workers from AI-related risks and tied broader economic struggles to current policy decisions. She warned that AI could exacerbate inequality, particularly through increased workplace surveillance, algorithmic management, and discriminatory hiring practices. She emphasized the role of labor unions and state governments in establishing protections, while criticizing efforts to preempt state-level AI regulations. She also stressed that existing labor laws still applied to AI-related practices and called for stronger enforcement by federal agencies. She concluded that AI policy should prioritize workers by strengthening unions, protecting privacy, and ensuring equitable outcomes.

SUMMARY OF WITNESS STATEMENTS

• Ms. Birbal stated that AI was already being widely used by employees to boost productivity, streamline routine tasks, and improve work-life balance. She emphasized that AI was expanding opportunities, particularly for people with disabilities, and enhancing HR functions such as hiring, job matching, and workforce development. She argued that the most effective use of AI was to augment human judgment rather than replace it, and that leading companies were approaching AI adoption as a workforce transformation effort. She highlighted practical applications including automating repetitive tasks to build career resilience, improving workplace safety through monitoring tools, and enhancing healthcare through data analysis. She maintained that existing workplace laws already provided a strong regulatory foundation and warned that overly prescriptive AI-specific rules could create confusion and duplication. She concluded that a principles-based federal framework focused on transparency, accountability, and flexibility would be the most effective policy approach.

• Mr. Gizzo stated that artificial intelligence was a powerful tool for improving wage and hour compliance and that Congress should take a measured approach to regulation to avoid stifling innovation. He explained that wage and hour laws were complex and difficult for employers to navigate, particularly for small and mid-sized businesses with limited resources. He argued that AI could help employers achieve greater accuracy, efficiency, and consistency in compliance through tools such as automated worker classification analysis, real-time timekeeping, and payroll calculations. He emphasized that these tools complemented rather than replaced human judgment and could reduce costly errors. He noted that improved compliance would benefit workers by ensuring they received proper compensation. He concluded that policymakers should adopt a balanced and standardized framework that encourages AI adoption while minimizing regulatory burdens.

• Ms. Steffens argued that the rapid expansion of AI in workplaces posed significant risks to workers, including increased surveillance, weakened labor protections, and greater inequality. She stated that AI-enabled monitoring tools allowed employers to track workers at unprecedented levels, making it more difficult for employees to organize and advocate for their rights. She emphasized that existing labor law protections were insufficiently enforced and that penalties for violations were too weak to deter misconduct. She highlighted concerns about privacy, data collection, and the potential misuse of worker information, including wage suppression and discrimination. She argued that unions played a critical role in giving workers a voice in how AI was implemented and in negotiating protections. She concluded that stronger labor laws, increased funding for enforcement agencies, and transparency requirements were necessary to safeguard workers.

• Ms. Greszler stated that AI was advancing rapidly and that policymakers currently lacked sufficient data to fully understand its impact on the workforce. She explained that while AI could increase productivity and raise long-term living standards, its speed and adaptability distinguished it from past technologies. She noted that AI often replaced specific tasks rather than entire jobs and still had limitations, including reliance on existing data and lack of physical capabilities. She emphasized that the lack of detailed data on AI use made it difficult for lawmakers, employers, and workers to make informed decisions. She proposed expanding federal data collection efforts through the Census Bureau and Bureau of Labor Statistics to better track AI’s effects on employment and tasks. She concluded that the greatest risk was not AI itself, but poor policy responses that could hinder innovation and reduce U.S. competitiveness.

SUMMARY OF KEY Q&A

• Chair Mackenzie asked about compliance challenges arising from varying state and local AI laws. Ms. Birbal explained that employers operating across multiple states faced overlapping and conflicting requirements, including differing definitions, audit mandates, and notice obligations, and she advocated for a consistent federal, principles-based framework to reduce confusion and compliance burdens.

  Chair Mackenzie asked about the effect of complex AI compliance standards on job growth. Mr. Gizzo stated that regulatory complexity, particularly across wage and hour laws, discouraged small and mid-sized business expansion and hiring, and he emphasized that AI tools could help these employers manage compliance more efficiently and support job creation.

  Chair Mackenzie asked how the government could keep up with the rapid pace of AI development. Ms. Greszler stated that policymakers should prioritize improved data collection, evaluate how existing laws apply before creating new ones, and focus regulatory efforts on clearly defined harms rather than broad or unclear mandates.

• Ranking Member Omar asked what privacy protections workers should expect in AI-monitored workplaces. Ms. Steffens stated that workers currently had very limited protections and warned that AI-enabled systems allowed continuous tracking of movements, communications, and biometric data, necessitating new federal standards for data collection and use.

  Ranking Member Omar asked about the risks associated with employer data collection. Ms. Steffens stated that collected data could be sold or shared with third parties, creating opaque worker profiles that could be used in hiring or evaluation without worker knowledge or recourse.

  Ranking Member Omar asked whether employers could use AI to violate labor laws. Ms. Steffens stated that existing laws still prohibited union busting, wage theft, and discrimination, but AI tools made it easier to carry out and conceal such violations, increasing the need for enforcement.

  Ranking Member Omar asked how labor protections could be strengthened. Ms. Steffens stated that enforcement agencies required increased funding and staffing, and she called for stronger privacy safeguards and limits on employer data collection and sharing.

• Rep. Fine asked what a pro-innovation federal AI strategy should include. Ms. Greszler stated that the government should prioritize national security, avoid overregulation that could cede leadership to adversaries like China, and invest in infrastructure and workforce development to support long-term competitiveness.

  Rep. Fine asked how Congress could improve the accuracy of labor market data related to AI. Ms. Greszler stated that existing surveys undercounted independent and gig workers and recommended more frequent data collection and expanded use of tools like the Business Trends and Outlook Survey to provide timely, comprehensive insights.

• Rep. Casar asked how many congressional hearings had addressed potential mass unemployment from AI. Ms. Greszler stated that there had been none.

  Rep. Casar asked how many legislative proposals had been advanced to prevent AI-related job loss. Mr. Gizzo stated that he was not aware of any.

  Rep. Casar asked how many executive actions had been taken to address potential unemployment from AI. Ms. Birbal stated that she was not aware of any.

  Rep. Casar asked about the scale of AI industry political spending. Ms. Greszler stated she did not have specific figures.

• Rep. Walberg asked how the federal government could improve compliance assistance in light of AI-driven workforce changes. Ms. Birbal stated that agencies should provide faster, clearer, and more practical guidance, including opinion letters, FAQs, and model policies, while focusing on higher-risk uses of AI.

  Rep. Walberg asked how improved labor data collection could better capture AI’s impact on work. Ms. Birbal stated that tracking tasks rather than just jobs would provide more precise insight into how AI was changing productivity, skills demand, and workforce needs.

  Rep. Walberg asked about the benefits of establishing a federal regulatory floor for AI. Mr. Gizzo stated that inconsistent state laws discouraged adoption and innovation, and a federal standard would provide clarity, reduce burdens, and support competitiveness.

• Rep. Grothman asked what a collaborative and voluntary approach to AI regulation would look like. Mr. Gizzo stated that policymakers should identify risks while preserving innovation, ensure definitions remained broad but targeted, and avoid overly expansive regulatory frameworks.

  Rep. Grothman asked how to shift workforce perceptions toward blue-collar jobs in light of AI. Ms. Greszler stated that AI was increasing the value of physical and non-automatable skills and that labor market adjustments would occur gradually as workers adapted to changing demands.

  Rep. Grothman asked how to address bias in AI systems. Mr. Gizzo stated that bias originated from underlying data rather than the technology itself and that existing legal frameworks already addressed discriminatory outcomes.

  Rep. Grothman asked how AI bias could be mitigated in practice. Mr. Gizzo stated that increased transparency, including disclosures and notices, could help users understand and account for potential bias.

• Rep. Messmer asked how AI could support compliance for businesses. Mr. Gizzo stated that AI tools could assist with worker classification, time tracking, payroll calculations, and regulatory updates, particularly benefiting small and mid-sized employers lacking dedicated compliance resources.

  Rep. Messmer asked about the importance of modernizing labor market data collection. Ms. Birbal stated that better data on job tasks and emerging roles would help policymakers and employers understand workforce changes and plan for future skill needs.

  Rep. Messmer asked about the risks of overregulating AI. Ms. Greszler stated that excessive regulation could undermine U.S. economic competitiveness and national security by allowing other countries to take the lead in technological innovation.

  Rep. Messmer asked how the United States could maintain leadership in AI. Ms. Greszler stated that the federal government should invest in infrastructure, develop workforce skills, and adopt flexible regulatory approaches that support innovation while allowing growth.

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